Finance Videos

Oct 10, 2017 | 01:47

Diamonds - the new gold for rich investors?

Diamonds can at last be an investor's best friend, according to the Singapore Diamond Investment Exchange. As Sonia Legg reports, it's just launched a new standardised form of the precious stones to rival gold ingots as a safe-haven alternative to cash.

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ACTUALITY "A rapidly changing world demands truly reliable asset classes - ones that have demonstrated value throughout human history"
They've long been a girl's best friend but diamonds could be about to become popular with investors.
The Singapore Diamond Investment Exchange has come up with a way of standardizing the value of the world's most concentrated form of wealth.
(SOUNDBITE) (English) CHAIRMAN AND FOUNDER OF SINGAPORE DIAMOND EXCHANGE, ALAIN VANDENBORRE SAYING:
"This is the first time in history that an investment product is made out of diamond as a physical tangible product. That diamond bullion is fully readable through application, and has an instant pricing, because it's uniquely listed on a regulated exchange in Singapore."
Gold is the most popular safe haven asset - a block of standard size and carat can have a set price.
That's not the case with a diamond - each stone has to be looked at individually, making value subjective and trading difficult.
(SOUNDBITE) (English) CHAIRMAN AND FOUNDER OF SINGAPORE DIAMOND EXCHANGE, ALAIN VANDENBORRE SAYING:
"Until about a year ago, there was no product that was meant for investors who invest into diamonds like they do for tangible assets like gold, and all the commodities."
The diamond bullion is produced by Singapore Diamond Mint.
They are stored in a credit card size device.
It has a chip that allows immediate valuation based on exchange trading.
(SOUNDBITE) (English) CHAIRMAN AND FOUNDER OF SINGAPORE DIAMOND EXCHANGE, ALAIN VANDENBORRE SAYING:
"So we're going to issue bullions in different denominations, we start at $100,000, we'll go a little bit up, and then we will go down when the market is ready."
Diamond trading had already been opening up.
De Beers now sells rough and polished stones through online auctions.
The new electronic exchange offers even more options - and gives a whole new meaning to the diamond credit card.

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